Rule allies food stamp systems

The Agriculture Department's Food and Nutrition Service has issued an interimrule to ensure that food stamp recipients can use their electronic foodstamp benefits across state borders.

The interim rule published in the Federal Register on Tuesday implementslegislation passed in February that requires nationwide interoperabilityof electronic benefit transfer (EBT) systems used to deliver food stamps.

The rule establishes uniform standards that states must follow in orderto achieve interoperability by October 2002. The standards are based onQuest operating rules, which more than 25 states already follow. However,there are many state EBT systems that do not interoperate, leading to widespreadfraud where recipients receive benefits in more than one state.

The federal government plans to fund the operational costs necessaryto make the state systems interoperate, but only up to a national annuallimit of $500,000. Costs beyond this amount will be covered at 50 percent.

Last year a study sponsored by the National Automated Clearing HouseAssociation, which represents 13,000 financial institutions, found thatit would cost about $500,000 a year to cover the fees associated with processingelectronic food-stamp transactions among EBT networks operated in differentstates.

FNS is accepting comments on the rule through Nov. 13.

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